Survey: Firms most concerned about cash flow, lower demand

Jerry Choong
·2-min read
Tan Sri Ter Leong Yap, president of the Associated Chinese Chambers of Commerce and Industry of Malaysia addresses reporters during a press conference at the Wisma Chinese Chamber in Kuala Lumpur  August 6, 2020. ― Picture by Choo Choy May
Tan Sri Ter Leong Yap, president of the Associated Chinese Chambers of Commerce and Industry of Malaysia addresses reporters during a press conference at the Wisma Chinese Chamber in Kuala Lumpur August 6, 2020. ― Picture by Choo Choy May

KUALA LUMPUR, Aug 6 — The ongoing Covid-19 pandemic has left many businesses worried about their cash flow and drop in sales, a recent survey has indicated.

The survey by the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) which polled 828 respondents revealed 68.3 per cent have been using their internal reserves for fixed operational expenses.

Its president Tan Sri Ter Leong Yap said this was one of several steps taken by the respondents to adapt to the new normal.

“33.1 per cent have taken on new loans or financing, while 32.8 per cent opted for the six-month automatic loan deferment for their existing loans.

“30.4 per cent said they negotiate payment terms with their suppliers, while 28.9 per cent say they enforce employment-related measures,” he said during a press conference to announce the survey’s findings.

Ter added that 21.2 per cent negotiate for a rental holiday, while 1.5 per cent said they used other methods, without specifying what those methods are.

“Overall 61.4 per cent of the respondents have said supply chain disruptions has led to a reduction in customer orders. Another 48 per cent say it has become increasingly difficult in collecting payments.

“36.8 per cent have reported the rising prices of raw materials, 34 per cent on the rising costs of logistics and shipping, and 25.3 per cent on the shortage of raw materials,” he said.

The increased difficulty in operating businesses has led to 12.8 per cent of the respondents being forced to breach contractual obligations, and only 11 per cent of the respondents reporting no impact on their businesses from Covid-19.

In mid-July, Ter had expressed ACCCIM’s concern over the expiration of the loan moratorium after September, in which he said the association hopes Bank Negara Malaysia will formulate flexible repayment programmes to assist businesses such as small and medium enterprises.

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